Trudeau goes head to head with Trump on climate in trade talks

Faced with competition from more loosely regulated US companies, Canada is seeking to protect its green economy in talks to renegotiate the North America Free Trade Agreement

Canada has put climate change on the agenda in talks to renegotiate the North America Free Trade Agreement, despite the US government officially being in denial of climate change.

Canada wants some type of border adjustment concept allowance for the US, Mexico and Canada, the signatories to the agreement, setting a unilateral border adjustment on a sector by sector basis, so that the Canadian government could apply a targeted carbon border adjustment tax. It also wants to be able to call out particular sectors and say it’s tantamount to dumping if they fail to have climate regulations costs included in cost of production.

The governing Liberal Party also wants to include the application of a carbon price on goods coming into the country, to better level the competitive playing field for Canadian businesses. Whether that can be sacrificed in favour of other demands remains to be seen.

“The point of all that would be to say our companies are competitively disadvantaged because US does not have a comparative climate policy as stringent as ours so we have to make our companies whole,” said Cameron Prell, counsel in the energy group of Crowell and Moring’s Washington, DC.

As the US’s second largest trading partner,...

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